City’s housing affordability better, but still bad: RBC

Buying a home in Vancouver got slightly more affordable this quarter, but the city’s real estate prices remain sharply out of line with those in the rest of the country, according to RBC Economics Research’s Housing Trends and Affordability Report released today.

The housing affordability measure used in the report indicates the percentage of a typical household’s monthly pre-tax income that would go to homeownership costs.

For Vancouver, the measure was 83.2% for the quarter, down 5.8% from the previous period.

Despite this drop, Vancouver’s prices remain considerably higher than those in other cities across the country, including:

Toronto: 52.4% (down 0.7% this quarter);

Montreal: 40.2% (up 0.1%);

Calgary: 38.3% (down 0.7%); and

Edmonton: 31.1% (down 0.6%).

“The largest improvements in housing affordability across Canada’s largest cities in the third quarter barely dented Vancouver’s status as the country’s most expensive city in which to buy a home,” said RBC senior vice-president and chief economist Craig Wright. “It’s important to note, however, that the situation is much less severe elsewhere in the province.

“If you look at Victoria, for instance, the share of income needed to carry the costs of a mortgage at market price is almost half that of Vancouver.”